We use cookies to customise content for your subscription and for analytics.If you continue to browse Lexology, we will assume that you are happy to receive all our cookies. For further information please read our Cookie Policy.

Federal news: Jul 21, 2015

According to a new report from the CMS Office of the Actuary, per-enrollee Medicaid costs for newly eligible adults were $5,517 in 2014, 19% higher than for other Medicaid adults. CMS had originally anticipated the costs for newly eligible adults to be 1% lower than for other Medicaid adults. The report postulates that most states that expanded Medicaid did so under managed care programs, and average capitation rates for newly eligible adults were greater than the projected average costs. Many states adjusted the capitation rates to reflect a higher level of acuity and a higher utilization of services due to pent-up demand. Of the total $457 billion increase associated with newly eligible adults between 2014 and 2023, the Federal government is projected to pay $426 billion, or 93%.

According to a report released this week by the Government Accountability Office (GAO), HealthCare.Gov renewed coverage for 11 of 12 fictitious applicants who initially applied online or by telephone and were enrolled in 2014 coverage as part of a GAO audit of enrollment controls. In 2014, the 6 applicants who began applying online failed to clear a required identity-checking step, but 5 of the 6 were able to enroll by calling the Marketplace. After enrolling, these individuals were required to submit documentation and all 11 maintained coverage after fictitious or no documentation was submitted. The 11 applicants paid premiums throughout 2014 totaling approximately $12,000 and their health insurers received approximately $30,000 annually in advanced premium tax credits. After the enrollees’ coverage was automatically renewed for 2015, 6 applicants were terminated early in the coverage year due to their failure to submit documentation associated with a new application, though the GAO had not filed any new applications. Coverage was reinstated in 5 of 6 cases after the GAO contacted the Marketplace.

The Affordable Care Act’s large employer mandate, which requires employers—including tribal government employers—with at least 50 full-time employees to provide health insurance, is under scrutiny in the Courts and U.S. Congress. According to the Wyoming Public Media Statewide Network, a U.S. District Court Judge ruled that, under the ACA, the Northern Arapaho tribe in Wyoming qualifies as a large employer and therefore must provide insurance, rejecting the tribe’s argument that the federal government is obligated by treaty to pay for tribal healthcare. Concurrently, Senator Steve Daines (R-MT) and Congresswoman Kristi Noem (R-SD) introduced S. 1771 and H.R. 3080, which now reside in the Senate Finance and House Ways and Means Committees, respectively, to exempt tribes and tribal entities from the ACA’s large employer mandate.